What is outsourcing?


Outsourcing refers to delegating certain aspects of the recruitment process to external service providers, such as recruitment process outsourcing firms.

Outsourcing is the practice of contracting or delegating specific tasks, functions or processes to external entities or service providers rather than handling them internally. Outsourcing allows organisations to leverage external expertise and resources, optimise operations and concentrate on core business objectives, ultimately supporting business growth and competitiveness. 

In the context of recruitment, outsourcing refers to the practice of delegating certain aspects of the recruitment process to external service providers. It involves partnering with external staffing agencies or recruitment process outsourcing (RPO) firms to handle specific recruitment activities on behalf of the client organisation.  

History of outsourcing 

Staffing agencies, also known as employment or recruitment agencies, have been a part of the recruitment landscape for many decades. These agencies provided an early form of recruitment outsourcing by acting as intermediaries, connecting job seekers with employers and helping organisations find suitable candidates for vacancies.  

In the 1990s and early 2000s, the first recruitment outsourcing firms emerged, bringing with them a more formalised method for outsourcing recruitment. Today, recruitment process outsourcing firms specialise in managing the end-to-end recruitment process for clients, meaning they take on responsibilities such as candidate sourcing, CV screening, interview coordination and onboarding.  

Recent trends in outsourcing 

In recent years, there has been a growing emphasis on leveraging artificial intelligence (AI) and automation technologies in recruitment outsourcing. Examples include AI-powered chatbots, CV screening algorithms and automated interview scheduling, all of which are being used to streamline and enhance the recruitment process. AI-driven tools are also being used to improve the candidate experience by offering tailored and efficient solutions, personalised communication and quicker feedback to candidates.  

The Covid-19 pandemic and the increase in hybrid and remote work models have also influenced outsourcing recruitment trends. Today, organisations are expanding their talent search beyond local boundaries and leveraging outsourcing partners' global networks. This enables access to a wider talent pool, including passive candidates and those in different geographical regions, which enhances diversity and provides access to specialised skills. 

In the wake of the pandemic and the Great Resignation, there has also been an increased focused on employer branding. By partnering with an outsourcing partner, companies can ensure consistency in their messaging, and in turn, effectively represent the company’s culture, values and employer value proposition (EVP) 

Advantages of outsourcing 

  • Cost savings through reduced recruitment infrastructure and expenses 
  • Time efficiency by leveraging specialised expertise and resources 
  • Access to a wider talent pool, including passive candidates 
  • Scalability and flexibility to meet changing hiring demands 
  • Reduced administrative burden for internal HR teams 
  • Compliance with employment laws and regulations 
  • Accelerated hiring timeline and faster onboarding process 

Disadvantages of outsourcing 

  • Loss of direct control over the recruitment process and candidate selection 
  • Dependence on the reliability and performance of the outsourcing partner 
  • A potential lack of understanding regarding the organisation's specific needs and requirements by the external provider